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If you can get past the hypophallic cover of this week's Bloomberg BusinessWeek, there's a story that the hedge fund industry wants you to avoid.

Hedge funds aren't worth the exorbitant fees they charge.

Just like actively managed mutual funds, hedgies can't consistently beat the market. And with the predominant 2-percent annual fee/20-percent profit haul, that consistently stacks the odds against them in an economy barely growing at 2 percent.

The piece, headlined "Hedge Funds are for Suckers," and expertly written by Sheelah Kolhatkar, notes the decline of the once fast-charging industry, which manages some $2 trillion in assets. Once the darlings of Wall Street, they are lagging the market and losing their assets.

All you need to know about the piece is an illustrative bar graph. For eight of the last 10 years, a simple stock-market index fund would've beaten most hedge funds. This year, hedgie performance is even more dismal, as Ms. Kolhatkar reports:

"According to a report by Goldman Sachs released in May, hedge fund performance lagged the Standard & Poor’s 500-stock index by

approximately 10 percentage points this year, although most fund managers still charged enormous fees in exchange for access to their

brilliance. As of the end of June, hedge funds had gained just 1.4 percent for 2013 and have fallen behind the MSCI All Country World

Index for five of the past seven years, according to data compiled by Bloomberg."

If investors have been played for suckers for most of the past decade, how are hedgies still staying in business and still charging those outrageous fees?

One reason is investor inertia. People rarely like to stomach losses and move on. They stay in and hope that things will turn around. They are seduced by the greed-soaked sales pitch that their managers can find "special opportunities" that the other managers haven't discovered yet.

In other words, investors are still smoked by the pure hokum of money managers who claim that they alone can ferret out unique profits when an entire global market has somehow missed them.

Little of what Ms. Kolhatkar reveals is particularly new. Money manager Simon Lack blasted away at hedgie hijinks in his book "The Hedge Fund Mirage" last year. When Lack did the math, he found out that you'd do better investing in boring U.S. Treasury Bills than investing in most hedge funds. In fact, you'd do twice as well investing in treasuries.

When I saw Lack debate hedge-fund advocate Ed Butkowsky late last year at a conference in Chicago, Lack was the hands-down winner. I asked Butkowsky to elaborate on his defense of the industry, but he never replied.